(08-29) 10:53 PDT San Francisco -- Google co-founder Sergey Brin and his wife are living apart amid allegations that he has "become romantically involved" with a Google employee, according to an AllThingsD report sure to send shockwaves through Silicon Valley.

While this is mostly a sad personal matter, the news introduces potentially messy business complications for Brin and the Mountain View search giant. The respected tech website's story, published online Wednesday afternoon, was based on unnamed sources and could not immediately be verified by The Chronicle.

The corporate world in and out of Silicon Valley tolerates extramarital relationships, but entanglements with subordinates are frowned upon because they can raise legal liabilities for the businesses or affect the workplace atmosphere.

Timothy Murphy, regional managing partner and employment attorney at Fisher & Phillips LLP in San Francisco, cited a number of potential issues raised in such a case, including: complaints of favoritism by other employees; allegations of being compelled into a relationship by a superior; and possible allegations of being discriminated against in terms of pay or assignments after a relationship ends.

Research division

Brin is director of special projects at Google, specifically focused on the secretive Google X research division that developed the company's Glass connected eyewear and self-driving cars. It's unclear whether the employee in question is in his direct reporting line or not.

Meanwhile, Brin has been married to Anne Wojcicki, co-founder of biotech company 23andMe, since 2007. She's the younger sister of Susan Wojcicki, the senior vice president of advertising at Google. The elder sister sublet her garage to Brin and co-founder Larry Page when the company was first incorporated and became the company's 16th employee.

Google has also invested millions in 23andMe.

"I'm not sophisticated enough in the Google corporate world to know whether or not they would be able to compartmentalize that or not," Murphy said. "But it doesn't sound like it's very comfortable."

Forbes magazine puts Brin's net worth at $22.8 billion, overwhelmingly from his tens of millions of shares of Google stock, representing one of the largest ownership stakes and biggest share of voting rights. AllThingsD reported that Brin and Wojcicki have a prenuptial agreement that would prevent any "material impact on Google" if they eventually divorce.

Working together

A spokesman for Brin and Wojcicki told AllThingsD that the couple would continue to work together on various philanthropic endeavors, including the Michael J. Fox Foundation for Parkinson's Research.

"They remain good friends and partners," the spokesman said.

Still, the news casts an unflattering light on a corporate giant that prefers to portray itself as a virtuous institution and intellectual playground, not a place of scandals.